How retirement reform affects members
From 1 March 2021, retirement benefits from provident funds will be treated in the same way as pension funds:
Provident funds will have the same annuitisation rules as pension funds. This means that members will have to buy a pension from a registered insurer with at least two-thirds of their retirement benefit unless the total benefit is R247 500 or less.
Provident funds balances saved before 1 March 2021 plus future growth won't be affected and can be taken as cash on retirement.
Members who are 55 years or older on 1 March 2021 will not be affected by this change if they stay a member of the same provident fund (or provident preservation fund) as proposed in the draft Taxation Laws Amendment Bill until retirement.